The leading cryptocurrency exchange is topping the charts despite bank restrictions.
Key Takeaways
- Binance is unlikely to be harmed by U.K. bank restrictions.
- Binance saw normal variation in trading volume last week, while its native token outperformed BTC and ETH.
- The U.K. makes up little of Binance's userbase, and it is not clear that other countries will impose similar policies.
Last week, several U.K.-based banks announced that they would block outgoing transactions to the crypto exchange Binance.
Notably, Barclays (NYSE:BCS) and Santander (NYSE:SAN) both announced blocks on payments to Binance. There is also speculation that Clear Junction denied Binance its services, leading Binance to suspend SEPA transfers.
However, it seems unlikely that these actions will significantly impact Binance, which is currently the largest exchange by trading volume.
First, the U.K. does not significantly contribute to Binance’s userbase. According to the web traffic site Similarweb, the U.K. provides just 3.75% of the exchange’s total number of users.
Furthermore, the events of the week do not seem to have affected trading volume. According to Nomics, which provides historical exchange trading data, Binance’s daily trading volume has fluctuated between $100 billion and $20 billion since late May.
At the time of writing, Binance had a daily volume of $33.2 billion, more than twice as much as FTX, its closest competitor.
On top of this, the negative news last week does not seem to have negatively impacted the price of the exchange’s token. Binance Coin (BNB) gained 8.5% last week—outperforming Ethereum, which gained 0.7%, and Bitcoin, which lost 0.6%.
Finally, it seems unlikely that U.K. banks will extend their strict policy against Binance to other crypto exchanges. Though the FCA published a specific warning that motivated banks to take action against Binance, that notice leaves room for other exchanges to operate.
The same warning notes that firms “must be authorised by us to advertise or sell these products in the UK.”
The exchange is also facing tougher regulations from other countries. However, none of these actions seem to be targeted at retail investors in the same way that U.K. bank restrictions are, meaning that the exchange is unlikely to lose ground any time soon.